Gibraltar Stock Exchange

Stock Exchange Expanding into Security Tokens

Description

The Gibraltar Stock Exchange (GSX) is licensed by the Financial Services Commission (the Gibraltar regulator and competent authority) and has been open since 2014.
The Gibraltar Stock Exchange operates the Main Market, an EU regulated market recognised by ESMA and by the United Kingdom's tax authority (HMRC) under S1005 (1)(b) Income Tax Act 2007.

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Vision

Team

CEO Nick Cowan was Managing Director at Bear Stearns UK from 1993-1995, after which he spent almost 8 years at ING Barings as the Global Head of Equity Trading and Global Head of Equities, concluding in 2004. From 2008-2013, he established a private trading fund, focusing on technical analysis to trade on his own account. He joined GSX as managing director in 2012 and has been instrumental in its development, getting it authorized as Gibraltar's first ever stock exchange in 2014 and spearheading blockchain initiatives.
COO Phil Walker has more than 20 years of consulting and marketing execution experience, managing and developing various brands. His focuses range from customer acquisition to digital marketing strategy to business performance measurement.

Team

Business Model

Traders and investors who transact on the GSX trading venue will pay a small percentage or fixed transaction fee, which GSX will recognize as revenue.

Problem

Initial security token offerings are challenging from a technological and regulatory perspective in and of themselves, but without liquidity on the secondary markets, security tokens lose much of their advantage against traditional private equity.

Solution

GSX intends to apply for regulatory approval from the Gibraltar Financial Services Commission to expand its trading venue services for the listing and trading of security tokens.

Traction

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Competition

GSX will face competition from security token exchanges and increasingly from partnerships between other crypto exchanges and small national stock exchanges.
Crypto exchanges boast high volumes of turnover, existing product and a captive audience of crypto traders. Small national stock exchanges similarly have access to high trade volumes, already established regulatory compliance frameworks, and large user bases.

Market Opportunity

Considering the nascent stage of STO, early liquidity for security tokens may be limited, but not insignificant. According to the World Federation of Exchanges database, 2017 saw a total of $77.566 trillion dollars in equity market turnover globally.
If the assumption is made that any equity issuer can also be a security token issuer, and if it is assumed that private companies will also launch STO, the total market opportunity for exchanges may exceed $77.566 trillion dollars in turnover per year.

Route-to-Market

GSX already has traction in the form of customers on both its traditional equities exchange as well as its crypto exchange. Its optimal route-to-market may be to market directly to its existing audience to create a critical mass of users for its early security token trading platform.
By leveraging its existing resources, GSX may be able to create early liquidity for security token offerings, potentially making it the venue of choice for issuers of security tokens through one of the token issuance platforms.

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Disclaimer

Security Token Network is not a registered broker-dealer or investment advisor in any jurisdiction. You cannot invest in any financial product or buy tokens through our website. Nothing published on Security Token Network should be constituted as investment advice or an endorsement of any project. All investments entail risk and you should seek professional investment advice from a licensed financial advisor before making any investment.

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